- Global liquidity rose sharply, with an annualized rate of more than 6%
- Bitcoin looked poised to hit a new all-time high.
Growing global monetary liquidity, which stands at over 6% annually, marked the fastest growth since April 2022. This will likely impact Bitcoin. [BTC].
The uptrend follows a four-year cycle, similar to that of April 2020. This rising liquidity is likely to boost the prices of risky assets, including Bitcoin, in the medium term.
Central banks, including the Federal Reserve and the ECB, are expected to cut interest rates in the coming weeks, heralding the start of the global easing cycle.
However, near-term headwinds remain, mainly due to the continued “unfavorable Fed liquidity environment” and a potential increase in USD strength.
The coming weeks could bring golden opportunities, especially for Bitcoin.
BTC’s cup and handle pattern
The increase in global liquidity will have a significant impact on the price of Bitcoin. Bitcoin is forming a massive cup-and-handle pattern, with a breakout expected around mid-September, likely during or after the Fed meeting.
This could spark a major rally, signaling the start of what analysts are calling the 2024-2025 Bitcoin bull run. Investors are encouraged to hold their BTC and prepare for this upward momentum.
Source: TradingView
If Bitcoin breaks its ATH, the price could rise to $100,000, especially if political events like a Trump victory materialize, as some analysts suggest.
However, if BTC encounters rejection near its ATH, analysts will need to conduct further analysis, but the overall bias remains bullish.
Long-term holder facility
Another bullish indicator is the supply of long-term Bitcoin holders, which is approaching a new ATH.
Up to the time of writing, long-term holders have held 16.13 million BTC for over 155 days, with the previous ATH reaching 16.29 million BTC in December 2023.
This strong accumulation by long-term holders, including institutions, indicates that key stakeholders remain engaged, increasing the likelihood of BTC heading higher in the coming months.
Source: The Bitcoin Lab
Bitcoin Volatility and Funding Rates
Bitcoin’s volatility levels have also returned near cycle highs, which could be either a positive or a negative for traders.
Although leveraged traders may face challenges, long-term investors see this as a promising sign of coming price movements.
While volatility remains lower than 2021 levels, it is likely to increase as institutional players reenter the market.
Source: Coinglass
Read Bitcoin’s [BTC] Price forecast 2024–2025
Bitcoin funding rates have remained bullish for over a year, supporting expectations of a strong price increase.
Bulls have dominated the futures market for 381 days. Growing global liquidity will likely continue to push Bitcoin’s price higher for the foreseeable future.
Source: CryptoQuant